11. Would the operating activities section of the company’s statement of cash fl
ID: 2451766 • Letter: 1
Question
11. Would the operating activities section of the company’s statement of cash flows contain an adjustment for a gain or a loss? What would be the amount and direction ( + or ? ) of the adjustment?
12. What is the amount of net cash provided by (used in) operating activities in the company’s statement of cash flows?
13. What is the amount of gross cash outflows reported in the investing section of the company’s statement of cash flows?
14. What is the company’s net cash provided by (used in) investing activities?
15. What is the amount of gross cash inflows reported in the financing section of the company’s statement of cash flows?
16. What is the company’s net cash provided by (used in) financing activities?
Explanation / Answer
Answer-11:
Yes, operating activities section of the company’s statement of cash flows shall contain an adjustment for a gain or a loss.
Adjustment shall be as under:
Less (-) : Gain on sales of Equipment = Sale Price - (Cost- Accumulated depreciation ) = 6600 - (15600-10400) =
$ 1,400
Answer-12:
Calculation of amount of net cash provided by (used in) operating activities:
Net income (125000+13200-133000)
$ 5,200
Add: Depreciation (106000-77000)+10400
$ 39,400
Less (-) : Gain on sales of Equipment
$ (1,400)
Add: Decrease in Accounts receivables (96800-89800)
$ 7,000
Less: Increase in inventory (120600-110000)
$ (10,600)
Less: Decrease In Accounts Payable (125000-70400)
$ (54,600)
Less: Decrease In Income Tax Payable (74400 -54600)
$ (19,800)
Net cash provided by (used in) operating activities
$ (34,800)
Answer-13:
Amount of gross cash outflows reported in the investing section
Purchase of Property plant and equipment = (318000+15600-308000)
$ (25,600)
Answer-14:
Calculation of company’s net cash provided by (used in) investing activities:
Purchase of Property plant and equipment = (318000+15600-308000)
$ (25,600)
Sales of Equipment
$ 6,600
Net cash provided by (used in) investing activities
$ (19,000)
Answer-15:
Calculation of Amount of gross cash inflows reported in the financing section
Bonds Issued (132000 -110000)
$ 22,000
Common Stock Issued (154000-132000)
$ 22,000
Gross cash inflows reported in the financing section
$ 44,000
Answer-16:
Calculation of company’s net cash provided by (used in) financing activities:
Gross cash inflows reported in the financing section
$ 44,000
Dividend Paid
$ (13,200)
Net cash provided by (used in) financing activities
$ 30,800
Answer-11:
Yes, operating activities section of the company’s statement of cash flows shall contain an adjustment for a gain or a loss.
Adjustment shall be as under:
Less (-) : Gain on sales of Equipment = Sale Price - (Cost- Accumulated depreciation ) = 6600 - (15600-10400) =
$ 1,400
Answer-12:
Calculation of amount of net cash provided by (used in) operating activities:
Net income (125000+13200-133000)
$ 5,200
Add: Depreciation (106000-77000)+10400
$ 39,400
Less (-) : Gain on sales of Equipment
$ (1,400)
Add: Decrease in Accounts receivables (96800-89800)
$ 7,000
Less: Increase in inventory (120600-110000)
$ (10,600)
Less: Decrease In Accounts Payable (125000-70400)
$ (54,600)
Less: Decrease In Income Tax Payable (74400 -54600)
$ (19,800)
Net cash provided by (used in) operating activities
$ (34,800)
Answer-13:
Amount of gross cash outflows reported in the investing section
Purchase of Property plant and equipment = (318000+15600-308000)
$ (25,600)
Answer-14:
Calculation of company’s net cash provided by (used in) investing activities:
Purchase of Property plant and equipment = (318000+15600-308000)
$ (25,600)
Sales of Equipment
$ 6,600
Net cash provided by (used in) investing activities
$ (19,000)
Answer-15:
Calculation of Amount of gross cash inflows reported in the financing section
Bonds Issued (132000 -110000)
$ 22,000
Common Stock Issued (154000-132000)
$ 22,000
Gross cash inflows reported in the financing section
$ 44,000
Answer-16:
Calculation of company’s net cash provided by (used in) financing activities:
Gross cash inflows reported in the financing section
$ 44,000
Dividend Paid
$ (13,200)
Net cash provided by (used in) financing activities
$ 30,800
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